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What to know about digital currency when preparing for your divorce

On Behalf of | Jan 21, 2022 | Divorce, High-Asset Divorce |

When you go through the asset division portion of the divorce process, you are setting yourself up with what you will need to start the new post-divorce chapter of your life successfully. As such, it’s important that you receive your fair share of your marital property. In preparation for this stage of your divorce, make sure that you are aware of the full extent of your marital property that is subject to division – including any digital currency that your spouse may have.

Why digital currency is important

When most people hear the term “digital currency,” they think of cryptocurrency such as Bitcoin. However, a person’s digital currency portfolio can constitute much more than cryptocurrency, and can include things such as e-Cash, central bank digital currencies or even funds on a stored-value card or distributed database.

Digital currency counts as personal property just like cash or money in a bank account. If your spouse has any form of digital currency in their name, then you may be entitled to your share of it during the divorce process. However, it may be up to you to make sure that your spouse fully declares it on their asset disclosure documents and doesn’t try to hide it from the divorce court.

How the court will divide it

The approach that the divorce court will take when dividing your marital assets will depend upon the jurisdiction in which the court is located. Each country – and each American state – has different laws regarding the division of marital assets.

If your divorce takes place in an Ohio court, then the court will first determine how much of the digital currency constitutes marital property, and how much is separate property. In general, the marital property portion of your digital currency portfolio will include any currency obtained during the course of your marriage – unless it was accrued as growth or interest from currency that either of you owned before your marriage.

Then, the court will divide the marital portion of your digital currency equitably – which does not necessarily mean equally. In other words, the court will take into account your individual financial situations, earning capacities and other sources of income before making a decision as to what a fair distribution would be.

Asset distribution is often one of the most complex and contentious aspects of any divorce. It can be challenging – but ultimately worthwhile – to make sure that you are getting the full extent of what you are entitled to.